Lotus, the unprofitable luxury sports car maker, fired chief executive Dany Bahar after a complaint from Malaysian parent DRB-Hicom about unspecified concerns over his conduct.
The board of directors at Lotus made the decision with immediate effect, the British-based company said.
Aslam Farikullah, a DRB-Hicom executive who's been helping run Lotus since Bahar was suspended last month, was named chief operating officer.
DRB, controlled by billionaire Syed Mokhtar al-Bukhary, is tightening its grip on Lotus after inheriting control of the British company through its purchase of Malaysian taxi and sedan maker Proton this year.
Bahar, who became chief executive in 2009 after being recruited from Fiat's Ferrari, was suspended last month in the middle of a five-year plan to turn Lotus around.
Lotus didn't disclose details of the investigation triggered by DRB's complaint and the statement did not elaborate on Bahar's successor.
Farikullah is one of three executives from Lotus' parent companies who were put in charge of daily management at Lotus during Bahar's suspension. Lukman Ibrahim and Mohd Khalid Yusof were the other officials from Malaysia.
The maker of the Elise sports car, which has struggled to compete against Porsche AG and Ferrari in Europe, has hung on to relevance in the auto industry partly because of its decades-long expertise in designing lightweight frames.
The Lotus Elise, at 912kg, is the lightest performance car sold in the United States, according to California-based Edmunds.com.
DRB, which has indicated it might sell Lotus if it doesn't meet performance targets, said last month it has no plans to sell the British carmaker.
In 2010, Bahar spearheaded a five-year turnaround plan to increase sales in emerging markets - especially China - and introduce five new models, starting with the Esprit at the end of 2013, according to Proton's annual report for the year ended March 2011.
Bahar said in December that Lotus could break even by 2014.